Afghanistan: Rebuilding a Nation

Hotel Sector - Profile No.2

Hyatt Hotel Construction

Project Summary
Subsector Construction
Location Kabul, Afghanistan
Project Cost $39.0 Million
Project Type Hotel Construction
Project Executing Firm/Agency Tepe Insaat and Afghan Reconstruction Company
LLC (ARC)
Funding Agency Overseas Private Investment Corporation (OPIC)

Afghan Minister of Foreign Affairs Abdullah Abdullah shakes hands with

OPIC President and CEO Dr. Peter Watson after signing agreement for a
hotel project in Kabul.

Project Outline
On February 27, 2003, the Overseas Private Investment Corporation (OPIC) and the
Government of Afghanistan concluded a memorandum of understanding pledging their
mutual support for the construction of a 5-star international hotel in Kabul, managed by
Hyatt International. OPIC President and CEO Dr. Peter Watson and Afghan Minister of
Foreign Affairs Abdullah Abdullah signed the memorandum in a ceremony at Blair
House. OPIC anticipates providing up to $35 million in financing and political risk
insurance to the project. “This project, the latest instance of OPIC support for frontline
states in the international war against terrorism, will help Afghanistan begin its
reconstruction by directly meeting a market need and improving the climate for foreign
direct investment,” Dr. Watson said. “We are honored by the opportunity to work with
Minister Abdullah and a leading hotelier such as Hyatt International to make this
important start down Afghanistan’s road to recovery.”

The 200-room deluxe hotel, to be called the Hyatt Regency Kabul, will be located in the
heart of Kabul’s business, government, and diplomatic district, and will offer a full range
of meeting facilities, as well as a communications and business center, restaurant, and

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recreation facilities. Hyatt International Corporation will serve as the hotel operator.
Hyatt will provide technical services during the design and construction of the hotel,
training and recruitment of the hotel staff prior to the hotel opening, and will manage the
hotel after its opening. The project will result in the training and employment of about
300 Afghans.

The project will also engage the services of three leading Turkish construction
companies—Tepe Group, Yuksel, and Limak—as well as the Afghanistan Reconstruction
Company, an Afghan-American company committed to assisting in rebuilding
Afghanistan's physical infrastructure and reviving Afghan business and commercial
institutions.

Mr. Marc W. Ellin, Vice President and Managing Director of Hyatt Hotels Corporation,
and Mr. Ali Kantur, Chairman of Tepe Group, also signed the memorandum.

The project represents significant progress toward fulfilling President Bush’s January
2002 announcement that OPIC would establish a $50 million line of credit to promote
private sector investment in Afghanistan. OPIC was established as an agency of the U.S.
government in 1971. It helps U.S. businesses invest overseas, fosters economic
development in new and emerging markets, complements the private sector in managing
risks associated with foreign direct investment, and supports U.S. foreign policy.

Technical Description
This hotel building will accommodate the following facilities:
• Lobby, café, bar, and administrative facilities
• 150-seat restaurant
• Deluxe single and double rooms
• Sports center including dressing rooms, showers, sauna, and swimming pool
• Boiler room
• Security building

Infrastructure works include:

• Electrical wiring
• Sewage and wastewater system
• Gas pipes
• Plastic water pipes
• Centralized heating and hot water
• Water reservoir with 5-day water reserve
• Power generator
• Fire protection system
• Security system, perimeter walls, gates, and guard houses
• Communication systems

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Chicago, IL - June 2003
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 Afghanistan: Rebuilding a Nation
Hotel Sector - Profile No.2

Project Site
The hotel will be built in Wazir Akbar Khan, Kabul, across from the U.S. embassy and
close to International Security Assistance Fund headquarters.

Project Status/Timeline
The construction phase will begin in the second half of 2003 and take approximately 18
months to complete.

Equipment and Services

The consortium is especially interested in purchasing and importing required hotel
interior furnishings, fixtures, equipment, and security installations, which will likely
include the following:

• Headboards and mattress sets • Curtain rails

• Nightstands and armoires • Balustrading
• Chairs and sofas • Wine racks
• Desks and tables • Fireplaces
• Audio visual equipment • Plumbing
• Refrigerators, stoves, and other • Heating and ventilation
appliances • Automated climate control system
• Mirrors and art • Computers and hospitality sector-
• Lamps and lighting fixtures specific software (electronic booking
• Elevators and reservation systems)
• Security systems (cameras, alarms, • Gym equipment (weightlifting
electronic and metal detectors, etc.) machines, etc.)
• Gates and perimeter walls • Swimming pool design and
equipment

U.S. Competitiveness
Although there is a strong competition from many Turkish construction companies, U.S.
companies can outbid their competition by providing a combination of high quality
products, services, and equipment at competitive prices.

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Project Financing
OPIC anticipates providing up to $35 million in financing and political risk insurance for
the project. The remainder of the financing will be provided by private investors.

Conclusion
A Hyatt Hotel in Kabul is expected to be very successful. The developers have expressed
their desire to have U.S. firms provide security equipment, furnishing, and fixtures.

Key Decision Makers

Organization or Company Name Afghanistan Reconstruction Company, LLC
(ARC)
Contact Person Mr. Zaher Yaqubie
Title Managing Director
Address 245 Park Avenue, Suite 2452, New York, NY
10167, USA
Telephone 212-792-4096
Fax 212-792-4027
E-mail Zaher.yaqubie@afghanrc.com

Organization or Company Name Tepe Insaat

Contact Person Mr. Buelent Oenen
Title Branch Office Manager
Address 554, Mescid Road, Wazir Akbar Khan,
Afghanistan
Telephone + 93-(0)-7027-68-99 (AWCC)
+ 90-505-325-06-67 (Turkish Mobile)
E-mail buonen@tepeinsaat.com.tr

Organization or Company Name Ministry of Civil Aviation and Tourism

Contact Person Eng. Raz Mohd. Alami
Title Technical Deputy Minister
Address Ministry of Civil Aviation and Tourism,
Kabul, Afghanistan
Telephone +93-70-277-576 or +93-202-101-031

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